UNIVERSITY SYSTEM OF GEORGIA

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USG Budget Stresses Need for Bread and Butter Money

Regents Approve $1.8 Billion FY 2004 Budget Request

Atlanta — September 11, 2002

Mindful of the weak national and state economic picture, the University System of Georgia Board of Regents approved today a lean budget request for submission to the state’s Office of Planning and Budget. The $1.8 billion Fiscal Year 2004 Budget Request responds to Gov. Roy E. Barnes’ call for fiscal prudence, while balancing the increasing demands on the System’s 34 institutions created by rising student enrollment.

The regents’ FY 2004 request focuses on the University System’s funding formula (which provides dollars for student instruction). Based upon the Gov.’s guidelines, no new special funding enhancements were proposed. The board also approved the FY 2004 capital projects request, as well as a one-time, $50 million request for the FY 2003 Supplemental Budget.

“Our FY 2004 Budget Request is very focused and streamlined,” said Daniel S. Papp, senior vice chancellor for Academics and Fiscal Affairs for the University System of Georgia, in the budget request presentation to the board. “The emphasis is on securing the ?bread and butter’ money for our institutions. Full support of this request will fund needed faculty and help us maintain appropriate student/faculty ratios in light of increasing enrollment and other demands on our institutions.”

The funding formula component of the FY 2004 Budget Request totals $145 million. These dollars reflect increases in enrollment and the number of credit hours taken during FY 2002 that would generate $81.5 million in new funds, $7.6 million for the operations and maintenance requirements associated with 1.6 million square feet in new facilities space, $22.2 million for retirement, benefits, and insurance needs, and $5.2 million for continuing education programs.

Another major piece of the formula increase request is the System’s Major Repair and Renovation budget. Approximately $28 million is requested to restore funds removed from the FY 2003 budget as well as new funds to maintain facilities.

The multi-year capital budget request approved by the board totals $501 million. This includes 22 major projects (though the General Assembly normally funds only a portion of this rolling list). The fiscal year’s minor projects request (projects under $5 million) is $68 million for 24 projects; also included is one payback project at $1.1 million.

The budget proposal also includes a $24 million request for Lottery funds for on-going projects such as the Equipment, Technology and Construction Trust Fund (ETACT) and GALILEO One Statewide Electronic Library.

The final element of the funding formula section of the budget request is $34 million for on-going special initiatives; including such programs as the Postsecondary Readiness Enrichment Program (PREP), the P-16 initiative, the Intellectual Capital Partnership Program (ICAPP), Teacher Preparation, and GALILEO (One Statewide Electronic Library).

While no specific dollar amount was indicated, the budget request includes language urging the Governor to provide an average merit salary increase for faculty and staff. Such an increase in the upcoming fiscal year would allow the University System to improve its competitive position nationally. Based upon informal surveys, it appears that in FY 2003, Georgia now ranks third in the 16 Southern Regional Education Board states.

The FY 2003 Amended Budget request includes: $7 million for the Eminent Scholars program, $4.5 million for the Georgia Public Library System, $25 million to restore previous cuts in the Board of Regents’ major repair and renovation fund, and $500,000 to fund a Data Warehouse project to help meet the regents’ and the state of Georgia’s data reporting requirements, in addition to other programs and needs.

Assisting Papp in the presentation were William Bowes, vice chancellor of fiscal affairs and Budget Director Usha Ramachandran.